Legislative Framework and Statutory Overview:
The Real Estate (Regulation and Development) Bill, 2013 was introduced in the Rajya Sabha on 14th August, 2013 after being referred to various committees almost after 4 years the bill was passed by Lok Sabha and Rajya Sabha in the year 2016. The bill received the assent of the President of India on 25th March, 2016 and subsequently the Real Estate (Regulation Development) Act, 2016 (“RERA Act”) was notified in the Gazette of India on 26th March 2016.
Prior to RERA, there was a lack of transparency regarding the real estate projects; diversion of money collected from the homebuyers for purposes other than the real estate project; unreasonable delays for completion and allotment. Therefore, to provide a solution to the above-mentioned problems RERA Act was promulgated with the following objectives: regulation and promotion of the real estate sector; sale of real estate project in an efficient and transparent manner; protect the interest of the consumers; establish an adjudicating mechanism for speedy redressal.
Since no considerable literature is available on RERA Act, an attempt has to be made to provide quick explanation notes in the form of a series. This article aims to give a brief background of RERA Act and its essential concepts.
The Real Estate (Regulation and Development) Act, 2016 (hereinafter “the Act” or “RERA”), received Presidential assent on March 25, 2016, and was notified with effect from May 1, 2016. This watershed legislation was enacted pursuant to Article 246 read with Entry 6 and Entry 7 of List III (Concurrent List) of the Seventh Schedule to the Constitution of India, conferring concurrent jurisdiction upon Parliament and State Legislatures to legislate on matters concerning transfer of property and contracts respectively.
Lawyer’s Comment: The legislative competence of Parliament to enact RERA has been tested and upheld by various High Courts. Practitioners should note that while RERA is a central legislation, its implementation is largely delegated to state authorities under Section 20 of the Act. This federal structure creates both uniformity in substantive rights and diversity in procedural implementation-a dual character that advocates must navigate carefully when representing clients across multiple jurisdictions.
The Act’s primary objectives, as discernible from its preamble and Statement of Objects and Reasons, are threefold: to establish Real Estate Regulatory Authorities for regulation and promotion of the real estate sector; to ensure sale of plot, apartment or building in an efficient and transparent manner; and to protect the interest of consumers in the real estate sector.
Jurisdictional Framework and Locus Standi:
Territorial Jurisdiction:
Section 20 of the Act mandates each State and Union Territory to establish a Real Estate Regulatory Authority. The territorial jurisdiction of each Authority extends to the entire state, though the appropriate Authority is typically determined by the location of the real estate project in question.
Lawyer’s Comment: A critical issue that has arisen in practice concerns inter-state projects or projects in Union Territories without established Authorities. In such cases, practitioners should examine whether the Central Real Estate Regulatory Authority has assumed jurisdiction under Section 20(2) of the Act. Additionally, when advising clients on forum selection, consider that Section 79 of the Act provides for appeals to the Appellate Tribunal, which also has state-wise territorial jurisdiction.
Pecuniary Jurisdiction:
Unlike civil courts, RERA Authorities do not have pecuniary jurisdiction limits. Section 31 empowers the Authority to adjudicate compensation of any amount, providing significant relief to allottees in high-value transactions.
Locus Standi of Complainants:
Section 31(1) confers locus standi upon “any aggrieved person.” The term has been liberally interpreted to include allottees, prospective allottees, associations of allottees, and in certain cases, even subsequent purchasers who have stepped into the shoes of original allottees through assignment or transfer.
Lawyer’s Comment: The Supreme Court’s interpretation of “aggrieved person” in consumer protection legislation provides persuasive precedent for RERA matters. However, practitioners should carefully establish the complainant’s direct nexus with the project and demonstrate how the alleged violation has caused specific prejudice to the client. In cases involving assignments, ensure that all assignment documents are properly executed and stamped to establish privity. The Authority may reject complaints where the complainant’s interest in the property is deemed too remote or contingent.
Grounds for Filing Complaints Under RERA
Section 18: Rights of Allottees in Case of Default
Section 18 constitutes the cornerstone of allottee protection, enumerating remedies available when promoters fail to fulfil their obligations. This section creates three distinct rights:
1. Right to Seek Refund [Section 18(1)(a)]
Where the promoter fails to complete or is unable to give possession of an apartment in accordance with the terms of the agreement for sale, or due to discontinuance of his business as a developer on account of suspension or revocation of registration, the allottee is entitled to withdraw from the project and obtain refund of the amount paid along with interest at such rate as may be prescribed.
Lawyer’s Comment: The right to refund under Section 18(1)(a) is not absolute and must be exercised judiciously. The promoter may defend by establishing that delay was caused by force majeure or that the allottee’s own actions (such as non-payment of installments) contributed to the delay. When drafting complaints seeking refunds, specifically invoke this provision and establish that the delay is attributable solely to the promoter. Additionally, cite the applicable State Rules to specify the rate of interest-for instance, MahaRERA prescribes interest at SBI’s MCLR plus 2%, while other states may have different rates. Recent jurisprudence from the Supreme Court in “Pioneer Urban Land and Infrastructure Limited v. Union of India” (2019) has clarified that interest on delayed refunds runs from the date of each payment, not from the date of final demand.
2. Right to Seek Compensation and Interest for Delayed Possession [Section 18(1)(b) & (c)]
The allottee may direct the promoter to pay interest for every month of delay until handing over of possession, at such rate as may be prescribed.
Lawyer’s Comment: Section 18 creates a statutory right to interest that cannot be contractually waived. Even if the builder-buyer agreement contains clauses limiting liability or providing for liquidated damages at lower rates, such clauses would be void under Section 19(4) as being detrimental to the interest of allottees. When quantifying claims, calculate interest on a monthly basis and ensure your computation accounts for the exact number of days of delay. In “Neelkamal Realtors Suburban Pvt. Ltd. v. Union of India” (2020), the Supreme Court held that the compensation under Section 18 is in addition to interest for delayed possession, not in substitution thereof. This creates potential for double recovery-interest for delay plus compensation for consequential losses-though the latter must be specifically pleaded and proved.
3. Right to Specific Performance [Section 18(1)(d)]
The allottee may seek direction for specific performance of the agreement for sale.
Lawyer’s Comment: Specific performance under RERA is distinct from remedies under the Specific Relief Act, 1963. RERA confers a statutory right that is not subject to the discretionary bars applicable to traditional specific performance suits. However, practitioners should be aware that seeking specific performance is mutually exclusive with seeking refunds-a complainant cannot claim both remedies simultaneously. The election of remedy must be made carefully after assessing the project’s viability and the promoter’s financial health.
Section 11: Functions and Duties of Promoters-Grounds for Structural Violations
Section 11 imposes numerous obligations upon promoters, violations of which constitute independent grounds for complaints:
- Section 11(2): Sale of plots/apartments only in projects registered under the Act
- Section 11(3): Execution of registered sale agreement within prescribed timelines
- Section 11(4)(a): Adherence to sanctioned plans and specifications
- Section 11(4)(c): Timely completion and obtaining completion certificate
- Section 11(4)(d): Deposit of prescribed percentage in separate bank account
- Section 11(4)(e): Obtaining occupancy certificate
- Section 11(4)(f): Transfer of land title and common areas to association of allottees
Lawyer’s Comment: Section 11 violations create strict liability and do not require proof of mens rea. When drafting complaints, cite specific sub-clauses violated and attach evidence of such violations. For instance, if the promoter has deviated from sanctioned plans (Section 11(4)(a)), obtain the sanctioned plan from the local authority and photographic evidence of the actual construction. The burden then shifts to the promoter to justify the deviation. Practitioners should note that violations of Section 11 can attract penalties under Section 59 (up to 5% of the project cost) in addition to compensation to allottees under Section 71.
Section 19(4): Prohibition Against Unfair Contractual Terms
This provision declares void any agreement that waives or diminishes the rights of allottees under the Act. Common unfair terms include escalation clauses without reciprocal de-escalation, one-sided force majeure clauses, and excessive interest charges.
Lawyer’s Comment: Section 19(4) is a powerful tool for challenging unconscionable contract terms. It operates as a statutory override to freedom of contract principles. When encountering onerous clauses in builder-buyer agreements, do not merely argue that they are unfair-affirmatively plead that they are void ab initio under Section 19(4). However, the Supreme Court in “Ireo Grace Realtech v. Abhishek Khanna” (2021) has held that not every asymmetric clause is automatically void-the test is whether it reduces or eliminates rights specifically conferred by RERA. For example, a clause allowing the builder to delay possession by six months may be valid if it’s reasonable, but a clause allowing indefinite delay would be void.
Misleading Advertisements: Section 12
Section 12 prohibits false or misleading advertisements. When allottees discover that promised amenities, specifications, or approvals were misrepresented, this provision provides recourse.
Lawyer’s Comment: Complaints based on misleading advertisements must be supported by the actual advertisement material-brochures, newspaper ads, website screenshots (notarized if from internet sources), and social media posts. Under Section 12, liability extends to the promoter as well as the real estate agent involved. Practitioners should name all liable parties to ensure complete relief. Additionally, consider whether the complaint should also invoke Section 2(zn) which defines “real estate project” to include all representations made in advertisements, thereby incorporating such representations into the contractual obligations.
Procedural Aspects of Filing Complaints
Pre-Litigation Requirements and Limitation
Section 31(2) provides that complaints must be filed within a period of one year from the date on which the cause of action arose. However, the Authority may entertain complaints after the expiry of the said period if the complainant satisfies the Authority that there was sufficient cause for not filing the complaint within the prescribed period.
Lawyer’s Comment: The one-year limitation period is not a statutory bar as stringent as in the Limitation Act, 1963. The provision itself contemplates condonation of delay “if sufficient cause is shown.” Drawing from Supreme Court jurisprudence in limitation matters, particularly “N. Balakrishnan v. M. Krishnamurthy” (1998), practitioners can argue for liberal construction of “sufficient cause.” However, do not rely on this latitude-advise clients to file complaints promptly. When calculating limitation, the cause of action for delayed possession typically arises on the date of promised possession plus any grace period. For quality defects discovered after possession, limitation runs from the date of discovery, not the date of possession-this follows the principle in “Ruby Commercial Corporation v. Pankaj Kumar Jain” (2020) where the NCDRC held that latent defects discovered later constitute a continuing cause of action.
Notice to Opposite Party
While RERA does not mandate a pre-complaint legal notice, it is advisable to send one both for creating a paper trail and for demonstrating bona fide attempts at amicable resolution.
Lawyer’s Comment: Though not statutorily required, a legal notice serves multiple strategic purposes: it establishes the complainant’s seriousness, creates documentary evidence of the dispute, may prompt settlement before formal proceedings, and most importantly, clearly marks the date when the builder was put to notice of default. This is particularly relevant when claiming interest, as some Authorities have held that interest becomes claimable only from the date of notice or demand. Draft notices precisely, citing specific breaches with dates, quantifying claims, and providing reasonable time (typically 15-30 days) for compliance. Retain proof of delivery through registered post or email with read receipts.
Drafting the Complaint: Essential Elements
A well-drafted RERA complaint must contain the following elements to satisfy both procedural and substantive requirements:
1. Proper Titling and Jurisdiction Statement
The complaint should be titled as “Complaint under Section [relevant section] of the Real Estate (Regulation and Development) Act, 2016” before the appropriate State RERA. Begin with a jurisdictional paragraph establishing why this Authority has the power to entertain the complaint.
2. Parties and Their Description
Precisely identify the complainant with complete residential address, contact details, and proof of identity. For the respondent (promoter), provide the registered office address, RERA registration number of the project, and designation of the authorized representative.
Lawyer’s Comment: Proper identification of parties is crucial. In cases involving multiple promoters or joint ventures, ensure all entities with liability are impleaded. Section 2(zk) defines “promoter” broadly to include developers, landowners, and any person who sells plots/apartments. If the project involves a landowner who has entered into a joint development agreement, both the developer and the landowner should typically be made parties. Failure to implead necessary parties may lead to incomplete relief or difficulties in execution.
3. Chronological Statement of Facts
Present facts in a clear, chronological narrative covering:
- Date and circumstances of initial booking
- Terms of the agreement for sale with specific reference to possession date and specifications
- Payments made with dates and amounts
- Promised delivery timeline and actual delay
- Communications with the promoter
- Current status of the project
4. Legal Grounds and Statutory Violations
Explicitly state which provisions of RERA have been violated. Do not merely narrate facts-connect each fact to a specific statutory breach.
5. Relief Sought
Clearly enumerate the relief(s) sought with specific quantification:
- Refund amount: Principal + interest calculated at prescribed rate from date of each payment to date of refund
- Compensation for delay: Interest at prescribed rate for each month of delay
- Compensation for mental agony and harassment: Specific amount with justification
- Litigation costs
- Any other relief deemed fit
Lawyer’s Comment: Be precise in quantifying relief. Vague prayers like “appropriate compensation” weaken the complaint. When claiming interest, provide a calculation sheet as an annexure showing: date of each payment, amount paid, interest rate, period of calculation, and total interest accrued. For compensation beyond statutory interest, you must plead and prove special damages-mere delay does not automatically entitle one to compensation for mental agony. Demonstrate concrete losses such as rental expenses incurred due to non-possession, medical expenses for stress-related ailments, or financial losses from inability to sell/rent the property. The Supreme Court in “Lucknow Development Authority v. M.K. Gupta” (1994), though in a different context, held that compensation for mental agony must be proportionate and supported by evidence.
6. Documents and Annexures
Attach all supporting documents as annexures, properly paginated and indexed:
- Builder-buyer agreement
- Booking form and allotment letter
- Payment receipts and bank statements
- Project brochures and advertisements
- Correspondence with promoter
- RERA registration certificate of project
- Legal notice and reply (if any)
- Any other relevant documents
Lawyer’s Comment: The evidentiary burden lies on the complainant to establish prima facie violation. Poor documentation leads to dismissal at the threshold. Ensure all documents are legible, properly authenticated (notarized if copies), and correctly correspond to the allegations in the complaint. In practice, many complaints fail because the annexures do not support the pleadings-for instance, claiming a possession date not mentioned in the agreement, or failing to attach proof of payments claimed. Cross-verify every factual allegation against the annexures before filing.
Filing Process: Practical Considerations
Most State RERA Authorities have migrated to online filing systems accessible through their respective portals. The advocate must:
1. Register on the portal with valid Bar Council enrollment details
2. Complete the online complaint form, ensuring all mandatory fields are filled
3. Upload supporting documents in prescribed formats (usually PDF, with size limits)
4. Pay filing fees through the online payment gateway
5. Generate and save the acknowledgment receipt with complaint number
Lawyer’s Comment: Online filing has streamlined the process but introduces technical challenges. Many advocates face difficulties with document size limits, format requirements, and portal glitches. Prepare documents in advance, compress large files without losing legibility, and name files descriptively (e.g., “Annexure-A-Agreement.pdf” rather than “Document1.pdf”). Save the complaint in draft form periodically to avoid data loss. After submission, immediately download and save the acknowledgment receipt-portal systems sometimes have issues retrieving filed complaints. Some State portals (notably UP-RERA and Gujarat RERA) require physical vakalatnama submission within a specified period even for online complaints; check state-specific requirements.
Post-Filing Procedure
Scrutiny and Admission
After filing, the complaint undergoes scrutiny by the Authority’s office. Defective complaints may be returned for rectification within a specified period (usually 15-30 days).
Lawyer’s Comment: The scrutiny stage is administrative, not judicial. Objections typically relate to incomplete forms, missing documents, incorrect fee payment, or jurisdictional issues. Rectify defects immediately upon notice-failure to do so results in rejection. If the defect objection itself is incorrect (e.g., Authority claims a document is missing when it was actually uploaded), file a rectification application with evidence of initial compliance. Some aggressive practitioners file a writ petition if defect objections appear arbitrary, though this should be a last resort given the delay it causes.
Notice to Respondent
Upon admission, the Authority issues notice to the respondent promoter to file a written reply within the prescribed time limit (typically 30 days).
Counter-Reply
After receiving the respondent’s reply, the complainant has an opportunity to file a counter-reply (also called rejoinder) addressing the defenses raised.
Lawyer’s Comment: The counter-reply is a critical but often under-utilized stage. Many advocates file cursory rejoinders merely denying the developer’s defenses. This is a mistake. Use the counter-reply strategically to demolish the respondent’s defenses with evidence and legal arguments. For instance, if the developer claims force majeure due to monsoon delays, produce meteorological data showing normal rainfall during the relevant period. If the developer claims that the buyer’s payment defaults caused the delay, produce complete payment records and demonstrate timely payments. Additionally, respond to new documents produced by the developer-if you don’t controvert them in the rejoinder, the Authority may accept them as undisputed.
Hearings and Evidence
RERA proceedings are quasi-judicial, governed by principles of natural justice. Multiple hearings may be scheduled where both parties can present oral arguments, examination of witnesses (though less common in RERA), and additional documentary evidence.
Lawyer’s Comment: Unlike formal court proceedings, RERA hearings are relatively informal and expeditious. However, do not mistake informality for casualness. Prepare thoroughly for each hearing with a clear outline of arguments, indexed documents, and relevant legal precedents. The Authority typically consists of technical members (engineers, architects) in addition to judicial members-tailor your arguments accordingly. For instance, when arguing about construction defects, technical explanations and engineering reports carry more weight than legal citations. Record the hearing proceedings in your notes; most Authorities do not provide detailed minutes, and your notes become important when challenging orders on appeal.
Inspection (If Required)
In cases involving construction quality defects or deviation from approved plans, the Authority may order a site inspection. A technical expert or Authority member visits the project site and submits an inspection report.
Lawyer’s Comment: Site inspection can be a double-edged sword. Request inspection when you are confident that ground reality supports your case. Before inspection, brief the Authority in writing about specific aspects to be examined-for instance, “inspect the drainage system in basement parking” rather than a general inspection request. If possible, be present during inspection to point out defects, though the Authority may conduct inspections ex parte. After inspection, the report is placed on record-study it carefully and file objections if it’s inaccurate or incomplete. In several cases, builders attempt to rectify obvious defects just before scheduled inspections; document the project’s condition through photographs and videography before the inspection date.
Final Arguments and Order
After evidence and hearings are concluded, the Authority may schedule a final hearing for arguments. Both parties present their concluding submissions, after which the Authority reserves the matter for orders.
The Authority must pass a reasoned order addressing the violations alleged, the evidence produced, and the relief granted or denied. The order is uploaded on the portal and served on the parties.
Lawyer’s Comment: Final arguments are your last opportunity to persuade the Authority. Prepare a written synopsis of arguments with citations and hand it over to the bench-this aids the Authority in drafting the order and ensures your key points are not overlooked. In the final arguments, synthesize the evidence, connect it to legal provisions, distinguish adverse precedents cited by the respondent, and emphasize favorable judgments. After the order is passed, read it carefully within 24 hours. If there are any arithmetical errors, clerical mistakes, or accidental slips, file an application under Order XLVII Rule 1 CPC (applied mutatis mutandis to RERA) for correction before the appeal period expires.
Quantum of Relief and Interest Calculations
Statutory Interest Rates
Different State RERA Rules prescribe different interest rates, typically linked to the Marginal Cost of Funds-Based Lending Rate (MCLR) of State Bank of India:
- Maharashtra: SBI MCLR + 2%
- Karnataka: SBI MCLR + 2%
- Uttar Pradesh: SBI MCLR + 2%
- Haryana: 10.75% per annum (fixed)
- Gujarat: 10% per annum or as per agreement, whichever is higher
Lawyer’s Comment: The variation in interest rates across states is significant and affects both the complainant’s recovery and the promoter’s liability. When advising clients with investments in multiple states, this differential should factor into settlement negotiations. For instance, in Gujarat, if the agreement provides for 12% interest on delayed refund, that higher rate applies; but in states with MCLR+2% formula (currently around 9-10%), the agreement rate may not apply if it’s lower than the statutory rate. Always calculate interest using the method prescribed in the relevant State Rules-some states prescribe simple interest, others compound interest calculated monthly.
Compensation Beyond Interest
Section 12, Section 14, and Section 18 empower the Authority to direct the promoter to pay compensation to allottees for violations.
Lawyer’s Comment: Compensation under RERA is distinct from and additional to the statutory interest for delayed possession or delayed refund. However, its award is not automatic-the complainant must plead and prove specific loss or damage. The Authority has discretion in determining quantum based on factors such as: duration of delay, extent of deviation from promised specifications, financial impact on the allottee (e.g., rental costs incurred), and mental agony suffered (though this component is often token). Recent orders from various State Authorities suggest compensation ranging from ₹50,000 to ₹5,00,000 for delays of 2-5 years, though no fixed formula exists. When claiming compensation, provide evidence of actual financial loss-rental agreements for alternate accommodation, loan EMI statements showing financial burden, medical bills for stress-related ailments, or opportunity cost calculations for blocked capital.
Defense Strategies for Promoters: Counter-Perspective
While this guide primarily addresses advocacy for allottees, understanding common defenses raised by promoters enables better anticipation and rebuttal:
Force Majeure and Section 18(1) Proviso
Promoters often invoke force majeure clauses in agreements and the proviso to Section 18(1) which states that no allottee shall be entitled to interest if delay is caused by force majeure.
Lawyer’s Comment: Force majeure is the most frequently raised but poorly substantiated defense. The Supreme Court in “Energy Watchdog v. CERC” (2017) held that force majeure must be specifically pleaded and strictly proved. Generic claims of “regulatory delays” or “monsoon” are insufficient. As counsel for allottees, challenge force majeure defenses by: (1) Demanding specific documentary evidence of the force majeure event and its causal connection to the delay; (2) Establishing that the event was foreseeable or within the promoter’s control; (3) Demonstrating that delays existed even before the alleged force majeure event; (4) Proving that the promoter failed to mitigate the impact of the event. Recent COVID-19 related delays present unique challenges-while the pandemic may constitute force majeure for lockdown periods (roughly March-June 2020 and April-May 2021), delays beyond these periods require separate justification.
Buyer’s Default in Payment
Promoters contend that the allottee’s failure to pay installments timely caused delays in completion, thus disentitling the allottee to interest or compensation.
Lawyer’s Comment: This defense succeeds only if: (1) The payment default is substantial and not merely technical; (2) There is a direct causal link between the payment default and construction delay; (3) The promoter issued proper demand notices for installments; (4) The payment default preceded the completion deadline. Counter this defense by demonstrating that the complainant-allottee had paid all demanded installments timely, or that delays in completion existed even before any payment default, or that the promoter failed to issue proper payment demand notices as per the payment plan. In “Imperia Structures Limited v. Anil Patni” (2020), the Supreme Court held that even if an allottee has defaulted, the promoter cannot deny possession indefinitely but must follow the procedure under Section 19(6) for termination after notice.
Agreement Terms and “Time Not of Essence” Clauses
Many agreements contain clauses declaring that time is not of the essence and granting extended grace periods to promoters.
Lawyer’s Comment: Such clauses, even if initially agreed upon, cannot override statutory rights under RERA. Section 18 creates a strict liability regime for delayed possession subject only to the force majeure proviso. A contractual grace period of say 6-12 months may be enforceable, but clauses providing indefinite extension at the promoter’s discretion are void under Section 19(4). Cite the Supreme Court’s observation in “Ireo Grace Realtech” (2021) that while parties are free to contract, they cannot contract out of statutory obligations under RERA. Additionally, even a reasonable grace period does not eliminate the liability to pay interest-it merely postpones the date from which interest calculation begins.
Strategic Considerations in RERA Litigation
Choice of Remedy: Refund vs. Possession
Section 18 offers mutually exclusive remedies-seeking refund or seeking possession with interest. This choice is perhaps the most critical strategic decision in RERA litigation.
Lawyer’s Comment: Advise clients based on a holistic assessment of multiple factors:
Factors Favoring Refund: (1) Substantial delays with no credible timeline for completion; (2) Builder’s financial distress or insolvency proceedings; (3) Significant deviation from promised specifications; (4) Client’s changed circumstances (relocation, financial needs); (5) Superior alternative investment opportunities.
Factors Favoring Possession: (1) Property appreciation exceeding interest likely to be awarded; (2) Near-completion status of project; (3) Emotional attachment or specific utility of the property; (4) Tax implications of refund (capital gains vs. rental income); (5) Lack of comparable properties at current market rates.
In practice, many allottees initially seek possession but switch to refund during proceedings as project delays persist. Section 18 does not explicitly address whether amendment from possession to refund is permissible. Different RERA Authorities have taken conflicting views-some allow amendment as a modification of relief sought, others require withdrawal and fresh complaint. To avoid this issue, file a complaint seeking refund in the alternative if there’s uncertainty about project viability, or clearly reserve the right to modify the relief based on project progress.
Settlement and Compromise
Many RERA complaints culminate in negotiated settlements. Section 32 empowers the Authority to facilitate conciliation between parties.
Lawyer’s Comment: Settlement offers strategic advantages: immediate relief, certainty of outcome, avoiding prolonged litigation, and often securing better commercial terms than an adjudicated order. However, settlements under RERA must be approved by the Authority and should not dilute the allottee’s statutory rights. When negotiating settlements: (1) Ensure any payment commitments by the promoter are secured through post-dated cheques or bank guarantees; (2) Insist on specific timelines with default clauses; (3) Draft comprehensive settlement terms covering all aspects-principal, interest, possession, specifications, penalties; (4) Reserve the right to revive the complaint if settlement terms are breached. File the settlement as a joint memo of compromise under Order XXIII Rule 3 CPC (applied analogously) to obtain Authority’s imprimatur-this makes the settlement executable as a decree.
Execution of RERA Orders
Section 40 empowers RERA to execute its orders as if they were decrees of a civil court. However, practical execution often presents challenges.
Lawyer’s Comment: Many allottees assume that an order in their favor automatically results in payment. Reality is more complex. If the promoter fails to comply voluntarily, execute the order by: (1) Filing an execution petition before the RERA Authority; (2) Seeking attachment of the promoter’s assets including bank accounts; (3) Invoking personal liability of promoter’s directors under Section 39; (4) In extreme cases, initiating insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 (though this has its own complexities post the “Colonel Vindhya” judgment); (5) Seeking prosecution under Section 69 for willful violation. The challenge is that many promoters facing multiple adverse orders are genuinely insolvent or asset-less. Conduct due diligence on the promoter’s financial health before investing significant time and costs in RERA litigation-sometimes, cutting losses early is prudent.
Appeals and Writ Jurisdiction
Appeal to Real Estate Appellate Tribunal
Section 43 provides for appeals to the Appellate Tribunal within 60 days from the date of order, extendable by another 60 days if sufficient cause is shown.
Lawyer’s Comment: The Appellate Tribunal is the statutory appellate forum, and resorting directly to High Courts under Article 226 should generally be avoided per the “alternative remedy” principle. However, several High Courts have entertained writ petitions in RERA matters where: (1) Jurisdictional objections are raised; (2) Constitutional validity of RERA provisions is challenged; (3) Gross procedural irregularities have occurred; (4) The RERA Authority has acted beyond its statutory powers. The Supreme Court’s judgment in “Newtech Promoters v. State of U.P.” (2021) conclusively settled certain constitutional challenges to RERA but left open the possibility of judicial review in cases of jurisdictional error or violation of principles of natural justice.
Limitation for Appeals
The 60-day period for appeals is strictly computed from the date of the order. Delay beyond 120 days (including the condonable 60 days) is generally fatal.
Lawyer’s Comment: Unlike Section 5 of the Limitation Act which provides for condonation if sufficient cause is shown (without a maximum limit), Section 43(5) of RERA imposes a cap of 60 additional days. This provision has been interpreted strictly by Appellate Tribunals. In “M/s Emaar India Limited v. Mamta Sharma” (2019, RERA AT Delhi), the Tribunal held that appeals beyond 120 days cannot be entertained unless extraordinary circumstances are demonstrated-and even then, the Tribunal’s discretion is limited. Therefore, advise clients immediately upon receiving adverse orders, and file appeals within the initial 60-day period wherever possible. Do not rely on condonation provisions except in genuinely unavoidable circumstances.
Emerging Jurisprudence and Recent Developments
Supreme Court Pronouncements
Recent Supreme Court judgments have significantly shaped RERA jurisprudence:
“Pioneer Urban Land and Infrastructure Limited v. Union of India” (2019): Upheld constitutional validity of RERA; held that the Act is prospective but applies to ongoing projects; clarified that interest on delayed refunds runs from date of each payment.
“Ireo Grace Realtech v. Abhishek Khanna” (2021): Held that asymmetric contractual provisions are permissible if reasonable but cannot negate statutory rights; addressed the interpretation of “agreement” under Section 2(a).
“Newtech Promoters v. State of U.P.” (2021): Comprehensively addressed constitutional challenges; upheld key provisions including stringent penalties and criminal prosecution provisions.
Lawyer’s Comment: These judgments form the bedrock of current RERA practice. Every RERA practitioner must master these decisions as they address fundamental interpretational issues. Additionally, state-wise Appellate Tribunal decisions are gradually building a body of precedent on specific issues like quantum of compensation, applicability of force majeure, interpretation of state-specific rules, etc. Regularly update your research to incorporate recent precedents-RERA jurisprudence is still evolving, and early decisions that may have taken lenient views toward promoters are increasingly being supplanted by more stringent interpretations favoring consumer protection.
Interaction with Insolvency and Bankruptcy Code
The intersection of RERA and IBC has created complex jurisdictional issues. Section 14 of IBC imposes a moratorium on proceedings against corporate debtors undergoing insolvency resolution.
Lawyer’s Comment: Post the Supreme Court’s judgment in “Colonel Vindhya S. Subramaniam v. Surbhi Developers” (2020), the position is that homebuyers are financial creditors under IBC and must pursue their remedies through the IBC process if insolvency proceedings have been initiated against the promoter. This significantly impacts RERA remedy-if a moratorium is in place, RERA cannot proceed with complaints seeking monetary relief. However, RERA retains jurisdiction for complaints seeking non-monetary relief such as specific performance or rectification of defects. As an advocate, check whether insolvency proceedings exist against the promoter before filing or pursuing RERA complaints. If IBC proceedings exist, advise clients to register as financial creditors in the insolvency process. Conversely, for promoters facing RERA litigation, initiating voluntary insolvency proceedings under IBC Section 10 can be a strategic defense-though this carries significant commercial and reputational costs.
Ethical Considerations and Professional Conduct
Practicing before RERA demands adherence to professional ethics while navigating the unique quasi-judicial environment that blends technical, legal, and consumer protection aspects.
Advocate’s Duty of Disclosure
Under the Advocates Act, 1961, and the Bar Council of India Rules, advocates owe duties of candor to the tribunal and honesty to clients.
Lawyer’s Comment: In RERA practice, this duty extends to disclosing material facts even if adverse to your client’s case. For instance, if the builder-buyer agreement contains a force majeure clause that may benefit the promoter-client, disclose it rather than concealing it and hoping the Authority won’t notice. Similarly, when representing allottees, if your client has defaulted on installment payments, address it proactively in the complaint rather than allowing the promoter to spring it as a surprise defense. Tribunals appreciate candor and are more likely to rule favorably on the merits when they trust the advocate’s representations. Concealment invariably backfires and damages both the case and professional reputation.
Avoiding Conflicts of Interest
RERA practitioners often face potential conflicts when multiple allottees from the same project seek representation, or when switching between representing allottees and promoters.
Lawyer’s Comment: While representing multiple allottees from the same project is generally permissible (and often advisable for consistency), be alert to potential conflicts. If some allottees seek refund while others seek possession, or if there are disputes over preferential allotment of units, conflicts may arise. Obtain informed consent from all clients after full disclosure. When switching from representing allottees to representing promoters (or vice versa), be scrupulous about confidentiality and avoid situations where information obtained in prior representation could disadvantage former clients. The Bar Council rules on conflict of interest apply with full force to RERA practice.
Fee Structures and Engagement Terms
Given the consumer protection nature of RERA, fee arrangements must be transparent and reasonable.
Lawyer’s Comment: RERA cases typically involve individual allottees with limited means, making fee sensitivity important. Common fee structures include: (1) Fixed fee for specific stages (complaint drafting and filing; per hearing; appeal); (2) Percentage of recovery (typically 10-15% of awarded amount); (3) Hybrid models combining fixed fees with success-based components. Whatever structure is adopted, document it clearly in the vakalatnama or separate engagement letter. For contingency fee arrangements, clarify how calculations will be made-particularly whether the percentage applies to principal amount only or includes interest and compensation. In high-value cases, consider obtaining part payment upfront and staging subsequent payments based on milestones. From experience, I recommend against pure contingency arrangements in RERA matters because proceedings can extend for 12-24 months, during which the advocate incurs significant costs and time investment with no interim compensation.
Mass Litigation and Class Actions
When multiple allottees from the same project face identical grievances, questions arise about collective litigation strategies.
Lawyer’s Comment: RERA does not currently provide for class action suits or representative complaints like consumer protection law does. Each allottee must file an individual complaint. However, practical efficiency can be achieved through: (1) Filing batch complaints with standardized format differing only in complainant-specific details; (2) Seeking clubbing or consolidation of similar complaints by the Authority for joint hearings; (3) Sharing evidence and legal research across cases to reduce costs; (4) Negotiating bulk settlements covering multiple allottees. When representing multiple allottees, be transparent about whether you’re offering individualized representation or cost-shared representation. Also consider forming or working with allottee associations registered under cooperative society laws-such associations can sometimes achieve better leverage in negotiations with promoters.
Practical Drafting: Sample Provisions and Clauses
Prayer Clause for Comprehensive Relief
“In light of the facts stated above and the grounds urged herein, it is most humbly prayed that this Hon’ble Authority may be pleased to:
A. Direct the Respondent-Promoter to refund the entire amount of Rs. _________ (Rupees __________) paid by the Complainant along with interest @ ___% per annum (as prescribed under [specify State RERA Rules]) from the respective dates of payment till actual realization;
B. Direct the Respondent-Promoter to pay compensation of Rs. _________ (Rupees __________) to the Complainant for the mental agony, harassment, and financial losses suffered due to the Respondent’s defaults and statutory violations;
C. Direct the Respondent-Promoter to pay interest on the delayed compensation at the rate of 18% per annum from the date of filing this complaint till payment;
D. Direct the Respondent-Promoter to bear the costs of this complaint including litigation expenses;
E. Pass any other order(s) as this Hon’ble Authority may deem fit and proper in the interest of justice, equity, and good conscience.”
Lawyer’s Comment: The prayer clause must be specific yet flexible. Quantify monetary relief precisely but include a residuary clause (prayer E above) to allow the Authority discretion to grant additional relief. When seeking interest, specify both the principal period (from payment dates to refund) and continuing interest on compensation. Many advocates overlook prayer for costs-include it explicitly as some Authorities award costs only if specifically claimed. In possession-seeking complaints, the prayer would differ: seeking direction for specific performance, direction to complete construction within a timeline, payment of interest for delay period, compensation for deviation from specifications, etc.
Force Majeure Rebuttal Paragraph:
“The Respondent’s plea of force majeure is nothing but an afterthought and a legal subterfuge to avoid its statutory obligations. The alleged force majeure events were neither unforeseeable nor beyond the Respondent’s control. Specifically: (i) The Respondent had already delayed construction by __ months even before the alleged force majeure event; (ii) The Respondent failed to take any mitigatory steps during or after the alleged event; (iii) Other projects in the same locality by different developers were completed on time, demonstrating that the alleged event did not render performance impossible; (iv) The Respondent has not provided any credible documentary evidence establishing the causal nexus between the alleged event and the construction delay.”
Lawyer’s Comment: Force majeure must be demolished through specificity and evidence. Generic denials are ineffective. When drafting rebuttals, obtain and cite: (a) comparative data on other projects; (b) meteorological records if weather is claimed; (c) timelines showing delays predated the event; (d) correspondence showing the promoter never mentioned force majeure at the time. Recent COVID-related force majeure claims require particularly careful analysis-acknowledge the pandemic’s impact during lockdown periods but challenge claims of force majeure for delays extending years beyond the lockdowns.
State-Specific Procedural Nuances:
Maharashtra (MahaRERA):
MahaRERA is among the most active and efficient state authorities. It maintains a comprehensive online portal with transparent tracking, regular hearings, and quick disposal rates.
Lawyer’s Comment: MahaRERA’s portal is user-friendly but has strict technical requirements for document uploads (PDF format, maximum 5MB per file). The Authority is known for substance-over-form approach and often condones technical defects if the complaint has merit. MahaRERA has established significant precedents on issues like calculation of carpet area, applicability of interest rates, and quantum of compensation. One unique feature is the suo motu cognizance power exercised actively-the Authority sometimes initiates proceedings against promoters based on monitoring reports even without individual complaints. When practicing before MahaRERA, focus on documentary evidence and precise quantification; the Authority’s orders are typically detailed and evidence-based.
Uttar Pradesh (UP-RERA):
UP-RERA covers one of India’s largest real estate markets spanning Noida, Greater Noida, Ghaziabad, Lucknow, and other cities.
Lawyer’s Comment: UP-RERA requires physical submission of vakalatnama and certain documents even for online-filed complaints-maintain vigilance about these hybrid requirements. The Authority has been proactive in penalizing errant promoters and has ordered several project attachments for non-compliance. UP-RERA’s approach tends to be more technical and legalistic compared to some other states, so ensure strict compliance with procedural requirements. The Authority maintains benches in different cities; ensure you file before the appropriate bench based on project location. Recent orders suggest UP-RERA is taking a strict view on force majeure claims and has rejected several pandemic-related defenses for delays extending beyond 2020-21.
Karnataka (K-RERA):
Karnataka’s RERA authority covers Bangalore’s massive real estate market along with other cities in the state.
Lawyer’s Comment: K-RERA has been relatively slower in disposing of complaints compared to Maharashtra or UP, though there has been improvement recently. The Authority often seeks technical reports from qualified engineers for construction quality disputes-be prepared to engage technical experts. K-RERA has taken a balanced approach in its orders, considering both consumer protection and real estate sector viability. One notable feature is the Authority’s emphasis on conciliation-many cases are referred to mediation before full adjudication. When appearing before K-RERA, be prepared for multiple adjournments; calendar your hearings accordingly and maintain regular follow-up.
Haryana (H-RERA):
Haryana RERA covers the Gurugram and other NCR region projects, representing a significant portion of India’s real estate disputes.
Lawyer’s Comment: H-RERA has adopted a strong pro-consumer stance with several landmark orders imposing heavy penalties on major developers. The Authority has been particularly strict on issues of delayed possession and has awarded substantial compensation in appropriate cases. H-RERA’s orders often run into hundreds of pages with detailed analysis-this demonstrates thorough consideration but also indicates the importance of comprehensive pleadings and evidence. The Authority has also been proactive in suo motu actions against unregistered projects. Given Haryana’s fixed interest rate of 10.75% (rather than MCLR-based formula), this may influence settlement negotiations compared to neighboring states.
Advanced Litigation Strategy:
When to Escalate to Criminal Prosecution:
Sections 59, 61, 63, and 69 to 71 of RERA provide for criminal prosecution of promoters for various violations, with imprisonment up to three years.
Lawyer’s Comment: Criminal prosecution should be a measured escalation, not a first resort. Consider initiating criminal proceedings when: (1) Civil remedies through RERA complaints have proven ineffective; (2) The promoter has wilfully and deliberately violated RERA orders; (3) There is evidence of fraudulent intent or criminal breach of trust; (4) The violation is egregious (such as selling the same unit to multiple buyers). However, be aware that criminal proceedings are handled by the prosecuting agency of the state government, not by private complaint. The allottee’s role is typically to provide information and evidence to RERA, which then refers the matter for prosecution. In practice, criminal prosecution remains underutilized, partly because the procedural pathway is unclear in many states. Recent trends suggest increasing willingness to invoke criminal provisions for wilful violations-this may serve as a deterrent and negotiating leverage.
Invoking Personal Liability of Directors:
Section 39 makes promoters (including directors, partners, and key managerial personnel) personally liable for RERA violations unless they can prove lack of knowledge or due diligence.
Lawyer’s Comment: When the corporate promoter is asset-less or judgment-proof, pierce the corporate veil by impleading directors personally under Section 39. This provision creates statutory personal liability and shifts the burden to the director to establish the due diligence defence. When drafting complaints against recalcitrant promoters, specifically name directors as parties and invoke Section 39 in the cause of action. This serves dual purposes: expanding the pool of assets available for execution and creating personal exposure that may prompt settlement. Recent RERA orders have increasingly invoked Section 39, attaching personal properties of directors for satisfaction of awards. However, be judicious-in cases where corporate defaults are genuinely due to market conditions rather than deliberate fraud, seeking personal liability may be seen as excessive.
Strategic Use of Interim Orders:
While RERA does not have detailed provisions for interim relief like the CPC, the Authority’s inherent powers allow for interim directions in appropriate cases.
Lawyer’s Comment: Seek interim orders when: (1) The promoter is alienating project assets or diverting funds; (2) Construction has stopped entirely and immediate resumption is needed; (3) The allottee faces irreparable harm (such as demolition threat to possessed unit). Frame interim applications carefully, establishing: urgency, prima facie case, balance of convenience favouring interim relief, and irreparable injury absent the relief. Support with strong evidence-mere allegations are insufficient for interim orders. In practice, RERA authorities are cautious about granting interim relief that prejudges the main complaint, but they will act to preserve the status quo or prevent manifest injustice. Examples of granted interim relief include: restraining sale of project land, directing deposit of disputed amounts in court, ordering continuation of construction, and directing provision of basic amenities to allottees in possession.
Conclusion and Role of the Advocate:
RERA represents a paradigm shift in real estate regulation, moving from caveat emptor to consumer protection. As legal practitioners, we are not merely litigators but participants in shaping this evolving jurisprudence.
Lawyer’s Comment: Eight years into RERA’s existence, its promise remains partially fulfilled. While the Act has undoubtedly empowered homebuyers and brought accountability, several challenges persist: delayed adjudications in some states, difficulty in executing orders against insolvent promoters, gaps in coordination between RERA and other regulatory bodies, and the continuing debate over RERA-IBC intersection. As advocates, our role extends beyond individual cases to systemic advocacy-identifying legal gaps, suggesting procedural improvements, and contributing to jurisprudential development through well-reasoned arguments and appeals.
The best RERA practitioners combine legal acumen with practical understanding of real estate, finance, and construction. They recognize that not every delay is malicious, not every promoter is dishonest, and not every allottee claim is meritorious. The goal is not adversarial victory but fair resolution that balances legitimate interests.
For advocates entering RERA practice, I offer these parting thoughts: Master the statute and rules thoroughly-superficial knowledge leads to poor outcomes. Build expertise in allied areas like property law, contract law, and construction standards. Develop relationships with technical experts for quality disputes. Maintain detailed case management systems given the documentary-intensive nature of RERA practice. Stay updated on emerging jurisprudence from all state authorities, not just your own. Most importantly, remember that behind every RERA file is a family’s dreams and decades of savings-practice with competence, integrity, and empathy.
RERA litigation is not just about legal technicalities; it’s about access to justice for the common citizen who has invested life savings in a home. As officers of the court and advocates for justice, we bear the responsibility to make RERA’s promise a reality, one case at a time.
Checklist for RERA Complaint Filing:
Documents Required:
- Builder-buyer agreement (registered copy)
- Booking/allotment letter
- Payment receipts (all instalments)
- Bank statements showing payments
- Project brochure and advertisements
- Correspondence with builder (emails, letters)
- Legal notice and reply (if sent)
- RERA registration certificate of project
- Possession date proof from agreement
- Current status photographs of project
- Any expert reports (for quality defects)
Procedural Steps:
- Verify project RERA registration status
- Calculate limitation period
- Send legal notice to builder
- Prepare complaint with precise quantification
- Gather and organize all annexures
- Register on state RERA portal
- Complete online complaint form
- Upload documents in prescribed format
- Pay filing fees
- Download and save acknowledgment
- Monitor portal for hearing dates
- File counter-reply after receiving builder’s response
- Attend hearings prepared with documents
Lawyer’s Comment: This reference chart should be on every RERA practitioner’s desk. Know these provisions by heart. When drafting complaints or arguments, cite section numbers precisely-“Section 18(1)(a)” rather than generic “Section 18.” Precision in legal citation demonstrates command over the law and enhances credibility.
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